Many homebuyers are moving out of state for these reasons:
Unsurprisingly, affordability tops the list. Recent Redfin home search data* show that prospective buyers are searching in affordable states like Florida, Texas, Arizona, Tennessee, and South Carolina, while seeking to leave pricier states like California, New York, District of Columbia, Massachusetts, and Illinois.
Homebuyers are moving out of state to metros like Miami, Phoenix, Las Vegas, Tampa, and Sacramento from metros like San Francisco, New York, Los Angeles, Boston, and Seattle. Note that some migration may occur in-state too, such as from San Francisco or Los Angeles to Sacramento.
Why? “The cost of living in Phoenix is low compared to places like the Bay Area, Seattle, Denver, and parts of the East Coast, where many out-of-towners are coming from,” a Redfin real estate agent explains.
2. Change of scenery.
The 2023 Housing Forecast from realtor.com indicates that homebuyers are likely to continue relocating to affordable areas due to remote work capabilities and higher housing costs. For some buyers, the freedom afforded by remote work might enable them to move to (or closer to) a dream location.
A change of scenery can also meet the need for more space. United Van Lines’ 46th Annual National Movers Study** confirms that Americans are moving out of state to less populated areas. This may give someone living in a costlier urban area the chance to purchase a home with a yard and more square footage at a lower price. Functional outdoor space was named a must-have home feature by Zillow for 2023 homebuyers.
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3. Climate change.
Homebuyers moving out of state also have concerns about climate change. As a Forbes Home survey notes, “Almost a third of survey respondents cited worsening weather conditions as a reason to move, and over half of respondents that moved within the last few years reported their move to be unexpected.”
These days, homebuyers have climate change and natural disaster on their radar—including tornadoes, hurricanes, floods, and severe winter storms. Though Florida is a popular state to relocate to, it also has climbing home insurance rates. This is attributed to a higher hurricane risk, as well as higher rates of insurance-related lawsuits.
That said, many feel it’s worth the cost to live by the ocean in a nice climate. Great weather can be subjective; the beach may be a dream for some, while others will do anything to escape the heat.
4. Live closer to family.
Along with seeking affordability, many people are also moving closer to loved ones.** Remote work may help smooth the transition. Priorities shifted during the pandemic. Now, many companies offer permanent remote work policies that allow for flexibility and the freedom to live close to family.
Living near family can be especially helpful if you need to assist or care for aging parents who want to remain in their house. If you’ve had a life change, like having a baby or getting divorced, you may need extra help.
5. Move to the suburbs.
The pandemic also resulted in the demand for goods and services moving away from city centers. This, naturally, has impacted employment. Gad Levanon, Ph.D., Labor Market Institute founder, confirms that millions more people are working from home instead of trekking into an urban office. Millions of households may move away from metro areas.
For homebuyers with more geographic freedom, lower-cost suburban homes could be attractive. “Households will continue to migrate to areas further away from city centers as they become more certain about the permanency of remote work options,” Levanon says.
What else is driving homebuyers to lower-density locations? United Van Lines’ study suggests that it might be retirement.** The study found that Baby Boomers and Gen Xers are making the most moves, with retirement accounting for roughly 20 percent of relocations. Retiring and relocating to a more affordable area may help stretch a budget, particularly for homeowners who downsize.
Homeowners entering this new stage of life may be eager to minimize maintenance and added costs. Selling and downsizing to a smaller home can solve the problem of empty bedrooms and a large backyard requiring regular care. Downsizing might also translate into a lower mortgage payment, freeing up cash for travel.